The NHS has set a target of saving 3% each year on the goods and services it buys in. Following a Cabinet Office review which recommends ways to increase efficiency and quality across the service, a plan has been produced to modernise and improve the way procurement is managed.

The NHS spends some 7 billion pounds a year on procurement and to ensure that money is well spent all NHS Trusts are being required to bring the quality of their purchasing up to that of the best. The Cabinet Office review showed that whilst there are many excellent examples of purchasing best practice, there are also some weaker areas. As a first step all NHS Trusts are being required to identify a lead Director for procurement. Their task will be to draw up procurement strategies with targets for achieving savings.

A new organisation, the NHS Purchasing and Supply Agency, will be set up in April 2000. It will build on the achievements of the NHS Supplies Authority and provide a national focus for procurement expertise. A principal aim of the Agency will be to ensure that purchasing issues are at the heart of policy making as well as providing support, advice and information to NHS Trusts.

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